Slow Growers – M1 Limited

M1 announced its 2Q2016 unaudited financial results on 15th July 2016. In my previous post, I have classified M1 as a slow grower. In fact, I classify M1, SingTel and Starhub as slow growers. These are the three giants that have dominated Singapore Telco market for years with little or slow growth.

Here is the reason why:

Stable Service Revenue

Service revenue for M1 was stable at S$407.3 million. The main services are handset sales, fixed services such as fibre broadband, international call services and mobile services. This is generally nothing different from what Singtel or Starhub are providing.

Fibre Broadband, Postpaid and Prepaid

Fixed services revenue grew 26.7% to S$50 million with a total base of residential and corporate fibre customers amounting to 145,000. In the same quarter, M1 added 14,000 postpaid customers and 24,000 prepaid customers. Since the other Telcos are also providing the same services, growing market share is pretty important for M1.

Conclusion

M1 declared an interim dividend of 7 cents. I will continue to hold M1 for its consistent dividend and predictable earnings.